Correlation Between Leader Steel and Public Packages
Can any of the company-specific risk be diversified away by investing in both Leader Steel and Public Packages at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Leader Steel and Public Packages into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Leader Steel Holdings and Public Packages Holdings, you can compare the effects of market volatilities on Leader Steel and Public Packages and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Leader Steel with a short position of Public Packages. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leader Steel and Public Packages.
Diversification Opportunities for Leader Steel and Public Packages
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Leader and Public is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Leader Steel Holdings and Public Packages Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Public Packages Holdings and Leader Steel is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Leader Steel Holdings are associated (or correlated) with Public Packages. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Public Packages Holdings has no effect on the direction of Leader Steel i.e., Leader Steel and Public Packages go up and down completely randomly.
Pair Corralation between Leader Steel and Public Packages
Assuming the 90 days trading horizon Leader Steel Holdings is expected to under-perform the Public Packages. In addition to that, Leader Steel is 1.8 times more volatile than Public Packages Holdings. It trades about -0.05 of its total potential returns per unit of risk. Public Packages Holdings is currently generating about -0.07 per unit of volatility. If you would invest 88.00 in Public Packages Holdings on November 2, 2024 and sell it today you would lose (9.00) from holding Public Packages Holdings or give up 10.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Leader Steel Holdings vs. Public Packages Holdings
Performance |
| Timeline |
| Leader Steel Holdings |
| Public Packages Holdings |
Leader Steel and Public Packages Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Leader Steel and Public Packages
The main advantage of trading using opposite Leader Steel and Public Packages positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leader Steel position performs unexpectedly, Public Packages can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Public Packages will offset losses from the drop in Public Packages' long position.| Leader Steel vs. Kossan Rubber Industries | Leader Steel vs. Sungei Bagan Rubber | Leader Steel vs. Awanbiru Technology Bhd | Leader Steel vs. BP Plastics Holding |
| Public Packages vs. Icon Offshore Bhd | Public Packages vs. Eonmetall Group Bhd | Public Packages vs. Berjaya Food Bhd | Public Packages vs. Datasonic Group Bhd |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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